Cabinet agreed to the reforms, including pre-recording all evidence for children under 12, viewing that evidence by video or CCTV, and holding evidence hearings within a specified timeframe.
However the Justice BIM, issued in December to new Justice Minister Judith Collins and released today, revealed that a lack of funding is delaying that work.
"Crown Law is unable to fund an increase in the pre-recording of child witnesses' evidence," the BIM says.
"Cabinet has agreed that work to identify funding options will begin after February 2012, following the completion of the review of the role and functions of the Solicitor-General.
"The Amendment Bill [implementing child witness reforms] will not be introduced until funding is found."
The BIM report also noted that changes to legal aid services and the expansion of the Public Defence Service has seen a decline in work for private lawyers that usually rely on legal aid.
"This is the cause of some discontent amongst lawyers, particularly at courts where PDS services are planned or have recently commenced."
The lower demand for legal aid services is being met with higher demand for community legal services, but the report notes that ongoing funding is also an issue here.
Community law centres are mainly funded by the Lawyers and Special Fund.
"Over the past four years the value of the Special Fund has diminished and the
Government has provided additional funding up to 2012/13 to maintain total funding of $10.97m per annum. There is no certainty of funding except for the Special Fund beyond 30 June 2013."
The Law Commission and the Independent Police Conduct Authority are also looking for ways to save money.
The authority suffered a $460,000 deficit in 2010/11.
"It no longer has the capacity to absorb further deficits of this magnitude from its reserves," the BIM report says.
The Government is also expecting a report on ongoing funding for Victim Support this month.
The BIM noted lower prisoner numbers, decreasing recorded crime levels - though violent crime is trending upwards - and faster court processes as significant successes in the past three years, opening the door to a greater focus on crime prevention and prisoner rehabilitation.